Update: Time to Take Some Universal Display off the Table

(Published Sept. 7, 2017)

The Apple (AAPL) iWatch announcement is next week and shares of Universal Display (OLED) have moved sharply higher over the past five days.

OLED was a mid-August add for the Sterling portfolio and shares have rewarded buyers some 16% from our targeted entry area. While our upside target of $144 still remains in play, the short-term $134 target is close enough, given the faster than anticipated move higher, that we’d take a portion of our holding off the table here.

Our view would be to reduce by 1/3 as our short-term price target is nearly achieved and shares may experience a sell-the-news reaction on the Sept. 12 Apple announcement. Furthermore, if Apple fails to connect OLED to the new iPhone, shares could quickly retreat $20 or more.

The market dictates vigilance, especially on those positions that have achieved large moves higher and approached long-term targets in a short timeframe.

This is a market in which we’d advocate taking partial profits (selling 20% to 33% of a position) if moves higher of 20% or more are met within three months of entry. The number is not static and exceptions can be made, especially when there are known catalysts on the horizon like the Apple announcement and how it may impact OLED.

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